As the soybean and corn seasons are coming to a close, producers are wondering about payouts due to price drops.
The harvest season for soybeans and corn is now on its way to closing, and as 2015 wraps up, many farmers are starting to wonder if they will be receiving any payments from their crop insurance coverage, since the prices have been declining this year.
Last year, many growers in northern Iowa and Minnesota saw yields considerably lower than typical.
The lower than average yields, in combination with the reduced crop prices meant that the crop insurance indemnity payments on soybean and corn in 2014 had been sizeable. This year, the majority of producers across the Upper Midwest experienced yields were above average. Moreover, the price reductions have not been as large as they were last year. Therefore, many are expecting that the payments that will be made on this coverage will be much less likely to occur, or will at least be notably lower than they were during the previous growing season.
There are quite a few parts of the country in which the crop insurance situation will be different to the Upper Midwest.
For example, the Southern and Eastern Corn Belt, this year, saw similar farm insurance situations that can be more closely compared to what the Upper Midwest went through last year, instead of in 2015. That said, there is still a reduced chance of receiving payments through their insurance coverage.
Many of the growers throughout Missouri, Ohio, Indiana and Illinois, among other states, are bringing in their final yields for 2015’s corn and soybeans and are finding that they have also fallen below their actual production history (APH) yields. Among them, many have purchased revenue protection (RP) growers insurance policies this year. Those who have purchased that coverage may be able to file for an indemnity payment on the losses they experienced this year.
Beginning on November 1, the USDA Risk Management Agency (RMA) issued the harvest prices for 2015 crop insurance. They were set at $8.91 per bushel of soybeans and $3.83 per bushel of corn. The RP policies are based on the corn futures price CBOT December average, as well as those for November in the month of October.